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EPA Releases Progress Report on Impacts of Hydraulic Fracturing on Drinking Water Resources

EPA released an interim progress report today, December 21, 2012, regarding its much-anticipated study of potential impacts to drinking water resources from hydraulic fracturing. EPA’s multi-year study, at the behest of Congress, seeks to identify and understand potential impacts to drinking water associated with water withdrawals, the fate and transport of chemicals associated with fracking, and wastewater treatment and disposal as a result of fracking activities.

Recently Enacted Fracking Ban in Colorado Challenged, Highlighting Divide Between State and Local Governments on Energy Production

On December 17, 2012, the oil and gas industry filed a lawsuit to overturn the recent ban on hydraulic fracturing (“fracking”) approved by citizens in the town of Longmont, Colorado. The lawsuit comes just weeks after the town of Longmont, approximately 30 miles north of Denver, voted to amend its City Charter to ban hydraulic fracking within its City limits. The potential environmental impacts of fracking, the authority to regulate the practice and related energy production activities, and the power struggle among the federal government, states, and localities in the current regulatory vacuum has generated a hotly contested nationwide debate.

“Stormwater Runs Through It” – Stormwater as the New Epicenter of Clean Water Act Regulatory Disputes

Stormwater, increasingly, is becoming the new battleground in Clean Water Act permitting disputes and related litigation and enforcement. Indeed, just this past week on December 3 and 4, 2012, the U.S. Supreme Court heard two different stormwater cases from the Ninth Circuit U.S. Court of Appeals, one concerning whether discharges from logging road culverts constitute point source discharges, and the other matter regarding whether municipal stormwater discharges from channelized sections of a river into downstream unchannelized portions constitute a discharge. These cases, however, are just the tip of the iceberg.

EPA Issues New Guidance to Assist Tenants in Avoiding Cleanup Liability at Contaminated Sites

In an effort to encourage brownfield site redevelopment and renewable energy development on contaminated sites, on December 5, 2012, EPA issued a guidance document designed to clarify the scope of enforcement discretion the agency will provide to tenants who undertake steps to avoid liability under CERCLA’s Bona Fide Prospective Purchaser (“BFPP”) provisions. In conjunction with the guidance memorandum, EPA also issued three new model comfort/status letters for lessees involved in renewable energy development on contaminated property.

Sentencing and the Alternative Fines Act in Clean Air Act Enforcement – The Difference Between $2 Billion Versus $2 Million in U.S. v. CITGO

On November 6, 2012, a federal district court denied the request of federal prosecutors to empanel a sentencing jury in U.S. v. CITGO Petroleum Corp., Case No. 06-cr-563 (S.D. Tex.), for the purpose of determining facts necessary to support a fine associated with CITGO’s “gross, pecuniary gain” under the Alternative Fines Act. The court so held because a sentencing jury “would unduly complicate or prolong the sentencing process.” As a result, the government’s proffered calculation of more than $2 billion under the Alternative Fines Act – aimed at recouping double the Refinery’s total profits over a ten-year time span – may be in jeopardy.

Missouri Revises its Model Environmental Covenant for Activity and Use Limitations on Contaminated Sites

Businesses that own contaminated property in Missouri, such as brownfield sites and former industrial locations, can avail themselves of Missouri’s Environmental Covenant Act (MoECA), RSMo Section 260.1000 et seq., 10 CSR 25-18.010(18) to expedite cleanup and, if site conditions allow, beneficial reuse of those properties. In particular, property owners can record an environmental covenant on their property that restricts certain land uses and site activities to minimize exposure to impacted soils and groundwater.

EPA Issues Final Decision on Missouri’s 303(d) List of Impaired Waters

On November 13, 2012, EPA Region 7 issued its final decision on the Missouri Department of Natural Resources’ (MDNR) list of impaired waters, bringing the total number of impaired waters on the Missouri 2012 303(d) list to 258.

EPA’s Enforcement “Watch List” Enters Second Year Online

For the past year, EPA has been posting a monthly “Watch List” of companies allegedly in violation of the Clean Air Act, the Clean Water Act, and the Resource Conservation and Recovery Act. The Watch List includes those facilities that purportedly have high priority violations under the CAA, and facilities with significant noncompliance status under the CWA and RCRA.

Sixth Circuit Holds “Adjacent” Means Adjacent – Major Blow to EPA’s Interpretation of Emission Source Aggregation for Air Permitting

On October 29, 2012, the U.S. Court of Appeals for the Sixth Circuit dealt the EPA a setback by denying its motion to rehear the court’s August 7, 2012, decision in Summit Petroleum v. EPA, 690 F.3d 733 (6th Cir. 2012). In Summit Petroleum, the court rejected the agency’s interpretation of its own regulations concerning when multiple emission sources are to be treated as a single source for air permitting under the Title V program. Consequently, when evaluating whether to aggregate multiple air emission sources based on if those sources are “adjacent” to one another, the agency is required to consider the ordinary meaning of the term adjacent (e.g., physical and geographical proximity), and not the functional interrelatedness of those sources as argued by EPA.

PCB Sediment Cleanup Case Settled for $366 Million by Single Defendant, With Reopener for NRD

EPA Region 1 and the Massachusetts Department of Environmental Protection announced recently the largest ever single-site Superfund “cash-out” settlement, $366.25 million (plus interest), associated with the New Bedford Harbor Superfund Site in New Bedford, Massachusetts.

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